This Will Go on Your Permanent Record! How Blockchains Can Transform Colleges in a Networked World

Given the demands of employers and the evolving needs of students, one area of the higher education that’s ripe for disrupting is the transcript—and Blockchains could emerge as a viable replacement.

What happens when a well-established enterprise, like the American higher education system, doesn’t trust its own data? On the other hand, what happens when the new stakeholders (prospective students, for example) lose control over the quality, accuracy or security of their own personal data—or wind up in a situation where the data is so fragmented that it cannot be used by employers for comparative evaluations? Or worse yet, what happens when the data itself has virtually no relationship to value?

The result is a system in which expensive third-party entities become gatekeepers while data rapidly outgrows even these “middlemen.”

The entire burden of communicating the value of higher education falls on the humble college transcript—a paper credential that records how many hours a student has spent sitting in a classroom. Paper transcripts may have been replaced by their digital replicas, but for all practical purposes, a college transcript is a static, standalone document that fails most of the market-facing tests we have come to expect in the age of the Internet. It is meant to be locked in a secure location and only shown on rare occasions—to graduate school admissions offices or hiring managers in HR departments, for instance—to verify attendance, grades, or degrees. The lowly transcript does not capture what a student has learned. Nor does it capture achievement outside of the classroom or the aspirations that may signal long-term career success. A student cannot sign email with a transcript, so it is not tied in any useful way to digital identities. Employers cannot endorse valued skills or the relevance of a project.

Celebrity lawyer and Harvard professor Alan Dershowitz once summed things up nicely: “When I was growing up, my mother would always say, ‘It will go on your permanent record.’ There was no ‘permanent record.’ If there were a ‘permanent record’ I’d never be able to be a lawyer. I was such a bum in elementary school and high school… There is a permanent record today, and it’s called the internet.”

I once interviewed a candidate for an executive position whose college transcript had an unexplained ten-year gap. It was only by accident that I discovered most of those ten missing years were spent in the federal prison system. My prospective employee was a convicted embezzler. In short, your high school guidance counselor was less than truthful: Your behavior, good or bad, did not go on your permanent record, because the permanent record, until quite recently, did not exist.

Locked in information silos, college transcripts are closed and inscrutable. There is an entire ecosystem of unaccountable third parties that exist only to analyze, compare and interpret them. Accreditors tell us what a credit hour means as a unit of learning. Payscale.com predicts lifetime earning potential for graduates of this college or that major field of study. Colleges are ranked along every conceivable dimension to establish a kind of reputational reality. Recruiting and referral services scout for potential employees. LinkedIn encourages its readers to endorse the “skills” of friends and acquaintances (and, frequently, complete strangers). Online course providers issue badges and certificates. Federal regulations govern the release of transcript information, while analysts combine that information into monstrous data warehouses that undermine personal privacy. New gauges of student ability and achievement are managed—at great cost—by these entities and obscure the obvious limitations of the current system. Students are more than transcripts and test scores. The college transcript is a 19th-century invention that has little do to with the educational institutions and workplace of the 21st century.

Students learn, grow and build their portfolios in ways that universities’ transcripts are ill-equipped to absorb. Undergraduate Student A, for example, has a 3.8 GPA and scored a 170 on the LSAT, but is not involved in many extracurricular activities or alternative learning advancement opportunities. However, Undergraduate Student B’s education has been marked by similarly high grades and test scores, but it has been episodic, punctuated by military service, entrepreneurial ventures, and family commitments. Student B has completed Coursera and edX certificates signed by instructors at Duke and Yale, while working as an editor for a well established legal website in her free time. With today’s system, a law school would see these two students stacked next to one another and might immediately believe Student A to be the best candidate because the rich data about Student B’s extracurricular efforts does not really exist in the digital space of the closed, current transcript system.

With rising third-party costs for colleges and universities as well as students’ “less traditional” educational trajectories (jumping between traditional university coursework, online and employer certifications, and other new alternatives to the “course unit”), it seems that the American system of transcripts is due for a digital overhaul. That’s where blockchains come in.

Blockchain technology borrows from the infrastructure that was invented to enable cryptocurrencies like BitCoin™ to function independent of central authorities. It is fussy and clunky and because it relies on the mathematics of cryptography, but blockchain technology is impenetrable to most people. But in the age of the Internet, we have grown accustomed to relying on tools that are not easily understood. Most people, for example, are only dimly aware that the simple act of opening a Web browser initiates a stream of coded messages to hundreds of computers that locate remote resources, authenticate users, and route information around the world. Because they allow millions of users who have never met to securely agree on a single, global ledger of transactions, blockchains are now being adapted to create Distributed Autonomous Entities (DAE’s) to record contracts or manage the flow of documents through global supply chains.

What if universities ditched the traditional, musty transcript in favor of a single, secure, global, distributed “registrar” to record all educational achievements? Utilizing blockchain technology, it is now possible to create a decentralized transcript. Unlike today’s standard, centralized transcripts, which are secure and tamperproof but inadaptable to the modern, digital student, these decentralized transcripts would be secure and tamperproof but also open to outside transaction blocks from an entire network of contributors. DAE’s today rely on a new blockchain industry to synchronize the network until everyone has a consistent ledger. These new transcripts would all require an individual’s private key and would be transparent in that anyone could design applications to connect stakeholders, extract data, add value to individuals and institutions, and arrange to deliver value to stakeholders. A successful implementation of this new kind of decentralized transcript would negate the necessity of costly third-party authorities and would enable students, educational providers and employers to cooperate in a system that provides a more well rounded picture of the modern applicant.

Pilots and experiments aimed at exploring these ideas are now underway at a dozen labs around the world. MIT’s Media Lab distributes a smartphone app that allows graduates to sign their emails with a transcript and control the amount of personal information it contains. The University of Texas is experimenting with blockchains as a new approach to capturing learning achievement for the far-flung campuses of their massive university system. The Center for 21st Century Universities at Georgia Tech is building prototype infrastructure that facilitates sharing and assigning value to the growing number of non-traditional certificates and credentials. Developments like these could change the way that the college and university system approach admissions. Blockchain technology has the potential to save money for both universities and students, and would open a world of possibilities for today’s digitally driven students.